Tools

In this section you will find the tools available to help to deliver equal pay. All of the tools featured here are grounded in the legislative framework and all are publicly available. There is a separate page on gender pay gap reporting.

There are other reputable tools, such as those produced by trade unions or by specialist consultancies, but because these are available on a subscription or member only basis, it has not been possible to include them.

Of the topics covered here, some are more relevant to employees, and some to employers.

The business case for taking action on equal pay

Employers may also find it useful to read the report of the Women and Equalities Committee inquiry into the gender pay gap – this sets out the wider economic case for gender pay equality. At paragraph 48 for example, Neil Carberry from the Confederation of British Industry is quoted as saying: “From a labour market point of view, the fact that we have a gender pay gap is, by definition, a sign of an inefficiency, and therefore resolving it is commercially important to our members.”

You can find the chapter on productivity from the Women and Equalities Committee Report here.

Employers will need to bear in mind, however, that the business case is sector and workplace specific. Organisations operating in sectors with large gender pay gaps, for example, or workplaces with a high degree of job segregation will not only have a larger pay gap, they will also be higher risk of equal pay claims being brought against them.

Knowing what the law says

As employers are responsible for ensuring that their employees receive equal pay for equal work all employers need to know what the law says.

The basic tool for delivering equal pay is the Equal Pay Statutory Code of Practice.Everyone involved in pay determination in the workplace should ensure that they are familiar with the provisions of the Code.

The Code will also help you to find your way through the The Equality Act 2010, which replaced the previous anti-discrimination laws with a single Act. The Act replaced previous legislation on equal pay, including the Equal Pay Act 1970, the Sex Discrimination Act 1975, and the equality provisions in the Pensions Act 1995, and gives women (and men) a right to equal pay for equal work. The provisions relating to equal pay are known as ‘the equality of terms’ provisions and are scattered throughout the Act, but they are all brought together in one place in the Code.

Additional obligations on public sector bodies

Scroll down for more about the additional obligations on public sector bodies in repect of equal pay.

Finding the causes of gender pay gaps in your sector

Understanding the wider context within which your pay system operates makes it easier to close the gender pay gap or to put right any unjustifiable differences in the pay of men and women doing equal work. It can be helpful not only to know something generally about why men’s average earnings tend to be higher than those of women, but also about how this manifests within particular industrial sectors.

The gender pay gap is wider, for example, in the private than in the public sector, and much wider in the financial services sector than in the healthcare sector. The extent of occupational segregation also varies markedly from one sector another. Sectoral information is essential, but may be hard to come by. Have a look for material produced by and for your own sector – this will be far more relevant than the national statistics, and will enable you to begin bench marking your organisation with others similar to you.

Comparing rates of pay with those of others doing similar work

There are a number of tools that enable people to make salary comparisons, but not all are designed with equal pay in mind, and when considering them it is as well to look both at their purpose and the quality of their database.

The ONS digital online tool was launched by the Government in December 2016. This interactive tool enables both employees and employers to find out about the gender pay gaps and average earnings in a wide range of jobs, categorised according to the standard industrial classifications used by the Office for National Statistics. Where the information is available, it also shows how many women and men work in each role.

Paywizard is connected to the Netherlands based non-profit Wage Indicator Foundation. The Foundation aims to make sure that visitors are well-informed about jobs, salaries and employment law. It collects and compares labour market information through on- and offline surveys and desk research, and serves as an online up to date labour market library for millions worldwide. The UK Paywizard was developed for the Foundation by Incomes Data Services (IDS) and is also used by the TUC.

The Equal Pay Barometer has been developed by WAVE to enable women in Wales to find out how their pay compares to that of men working in Wales, and is based on the labour market survey in Wales.

Salary Searchis a subscription service run by Croner Reward. The service is designed primarily for employers. The pay data held is collected from employers throughout the UK, and the results are then checked and analysed. Roles can be compared against the market using 600 job titles. Data is updated monthly.

Advice on equal pay in practice

A simple and straightforward pay structure

A pay system provides the basis on which an organisation rewards workers for their individual contribution, skill and performance. Each organisation will have its own unique pay structure, which it uses to determine specific pay rates for particular jobs or roles, usually based on the nature of the job, its content and requirements. A pay structure provides the framework within which the organisation places the pay rates for its various jobs or groups of jobs.

The structure should be explicit – if the method of determining rates of pay exists only in someone’s head (which might be the case for a start-up company) then that method needs to be converted into a system that is as simple and straightforward as possible. People need to know how much they will earn, and what they have to do to earn it. This is known as ‘transparency’ and where equal pay is concerned, it is a legal requirement. For more on this, take a look at the Equal Pay Statutory Code of Practice.

Acas has published an advisory booklet Pay Systems, which provides an introduction to the variety of pay systems currently in operation in the UK. Acas can also visit your organisation to help you understand what needs to be done to address a range of issues related to pay and reward and then work with you to develop practical solutions, including those aimed at tackling unequal pay.

Gender neutral job evaluation

Gender neutral job evaluation is explained in the Equal Pay Statutory Code of Practiceand is the best way both of establishing where men and women are doing equal work, and of ensuring women’s skills are not undervalued.

Men and women in the same employment who are performing equal work should receive equal pay. Equal work means ‘Like work’ – work which is the same or broadly similar; work that has been rated as equivalent under an analytical job evaluation scheme; or work of equal value, that is, work that is different but which is of equal value in terms of the demands of the job. ‘Demands’ mean the skills, knowledge, mental and physical effort and responsibilities that the job requires.

Job evaluation is a method for comparing different jobs to provide a basis for a grading and pay structure. Its aim is to evaluate the job, not the jobholder. Evaluating job demands inevitably involves value judgements that are, to some extent, subjective, and the aim of a job evaluation scheme is to minimise the scope for subjectivity, thereby making decisions about jobs as rational, consistent and transparent as possible, and helping to avoid bias or discrimination.

The most reliable way of assessing whether jobs are of equal value is to use an analytical job evaluation scheme specifically designed and introduced to take account of equal value considerations and of the types of jobs being done by your workforce. Ideally the scheme should cover all employees.

Acas has published an introductory advisory booklet Job Evaluation: considerations and risks. Page 25 of the booklet sets out what additional assistance Acas can provide in helping employers to understand what needs to be done and how to do it.

If you do not use analytical job evaluation you need to find an alternative means of checking whether protected groups are doing work of equal value. It is important to recognise that these alternative estimates of equal value are not as reliable as analytical job evaluation, and that your organisation may therefore still be vulnerable to equal pay claims.

The existence of an up-to-date gender neutral job evaluation scheme provides an employer with an automatic defence against an equal value claim where:

The job done by the person claiming equal pay has been given a different i.e. lower value than the comparator’s under the job evaluation; and

The job evaluation scheme satisfies the standards set by the courts and tribunals, i.e. it is analytical; thorough and impartial; gender neutral; and reliable.

Non-statutory guidance on gender neutral job evaluation

The NHS Staff Council has published the NHS Job Evaluation Handbook, which is applicable across the UK. While aimed specifically at establishments within the NHS, the guide is the most thorough currently available and includes in-depth guidance on matters such as factor plans, profiling and what to do when a merger takes place.

Equal Pay Audits

An equal pay audit provides a framework within which an organisation can assess its vulnerability to equal pay claims and take action to deal with any potentially unlawful differences in the earnings of women and men doing equal work. Audits are recommended in the Equal Pay Statutory Code of Practice, and since October 2014 Employment Tribunals have had the power to order any employer who loses an equal pay case to carry out an equal pay audit. On its page ‘How to implement equal pay’, under the heading of ‘how to achieve equal pay’ the Equality and Human Rights Commission states that “The first and most important step towards achieving equal pay is to carry out an equal pay audit (for large employers) or an equal pay review (for smaller employers).”

An audit helps an organisation to decide:

Whether male and female workers are doing equal work;

If they aredoing equal work, whether they are receiving the same pay and contractual benefits, and if men and women doing equal work are not receiving equal pay, why not;

Whether the reasons for any differences in the pay of women and men doing equal work (i.e. for them not receiving the same pay and benefits) are legitimate;

On an action plan to remove any potentially unlawful differences in pay

It’s important to note that the starting point is not a gender pay gap, but whether women and men are doing equal work – if a woman is not doing equal work to a male colleague then she will have no grounds for claiming equal pay. And while an organisation might start by looking at differences in average earnings, an audit considers differences in actual earnings – a headline figure of an 8 per cent gap in average earnings could mask much wider gaps in different parts of the business.

An equal pay audit can also be used to look for pay gaps by gender, ethnicity, disability or working pattern.

Pay analysis software

In order to find out whether employees are receiving equal pay for equal work an employer will need to collate and analyse a range of data about employees, their hours and patterns of work, and what they are paid.

Some software providers offer software and support packages specifically designed to identify any pay inequalities and implement a strategy to deal with them, and most non-specialist software providers can be briefed to produce software which will enable you to carry out the statistical analyses that you require. Whichever route you choose, it is important to remember that responsibility for ensuring equal pay for equal work remains with the employer, and cannot be devolved to the pay consultancy or software provider.

Data Protection

Processing and disclosure of personal information is protected by the Data Protection Act 1998 and any data held on computerised and non-automated systems from which individuals can be identified are considered personal data. Data assembled to enable an employer to identify any gender pay gaps and check whether employees are receiving equal pay for equal work may include personal data such as employees’ names or payroll numbers.

This means that employees’ consent to the processing of personal data is required even if, as will most often be the case, the outputs of the analysis are anonymised. Unless employees have given their express consent to the processing and disclosure of personal data, employees will need to be informed about the analysis and notified of any third parties, such as consultants or trade union representatives, who will have access to the data. However, it is not necessary to inform employees individually; staff can be informed by way of a circular or the staff intranet. The Information Commissioner has issued guidance on the Conditions for Processing Sensitive Personal Data.

Trade union representatives and external consultants involved in the pay analysis are required to observe data protection principles, which should be agreed with them before the analysis is begun.

Action short of an equal pay audit

While carrying out an equal pay audit is the most effective means of ensuring that a pay system does not inadvertently discriminate on grounds of sex, actions short of a full audit can also help to eliminate sex bias. The Equality and Human Rights Commission has a page on pay systemswhich sets out actions short of a full equal pay audit.

These include:

Making sure your pay system is transparent

Having one simple pay system for all employees

Using job evaluation to objectively assess the demands of different jobs

Carrying out an equality impact assessment of any proposed changes to your pay system. An equality impact assessment is an analysis of a proposed change to an organisational policy to determine whether it has a disparate impact on one gender, ethnic group, those with disabilities or those working part-time. An equality impact assessment in relation to pay is a statistical analysis of an organisation’s proposals to change one or more aspects of its grading and pay structures, with potential impact on one or more groups of its employees. While equality impact assessments are widely used in the public sector they are also applicable to the private and third sectors. The outcome of the analysis will give you confidence in your pay decisions.

Checking salaries on entry to the organisation and on entry to grades

Checking grading structures in your pay system

Checking rates of progression within and through the grades

Ensuring equality in competence pay

Dealing with any problems in performance related pay

Considering the effect of market forces

Making sure there is equality in bonus payments

Eliminating gender bias from working time payments

Limiting local managerial discretion over all elements of the pay package

Small businesses

Close the Gap has developed an online tool to help small and medium organisations bridge the gender pay gap. Close the Gap’s Think Business Think Equality tool is clear and simple, with five short tests that focus on different themes.

These are: flexible working, progression and promotion, workplace culture, men and women doing different types of jobs and then pay and reward. For each topic there is a test, and businesses can take each test separately or can choose to do them all at once. Each test should take no longer than five minutes to complete and at the end, , you get an assessment report and a score which tells you what you are you are doing well, what you could do better, and provides you with a tailored action plan.

Getting help

Acas have a network of specialist equality and diversity advisers around the country. They will look at your current policies and practices with you, recommend improvements, help put them in place and provide training if you need it. Contact your local Acas office to find out what help they can give you.

If you are a member, then both The CIPDand Business in the Community‘s Opportunity Now campaign provide guidance on good equal pay practice. Reducing the gender pay gap is one of Opportunity Now’s three campaign aims. The BITC link takes you to Best Practice Recommendations for Equal Pay from exemplar work with its members; these are a useful starting point for any organisation wanting to proactively address their gender pay gap. XPertHR also has a comprehensive range of advice on good equal pay practice.

Chambers of Commerceprovide training for their members and the wider business community, and if asked would be able to set up courses on equal pay. In Scotland theClose the Gapcampaign may be able to help.

The client training arms of law firms also provide seminars on equal pay. These are generally aimed at existing practitioners and will be less suitable for organisations new to good equal pay practice.

The Public Sector Equality Duty and the England Specific Duties

The Public Sector Equality Duty consists of a general duty which applies equally across Great Britain, underpinned by a number of specific duties which vary across England, Scotland and Wales. The general duty requires public bodies to have due regard to the need to:

Eliminate unlawful discrimination, harassment and victimisation and other conduct prohibited by the Equality Act 2010;

Advance equality of opportunity between people from different groups; and

Foster good relations between people from different groups.

Equal pay would come under the heading of eliminating unlawful discrimination. Go to Government for more information.

The Public Sector Equality Duty and the Wales Specific Duties

Public sector bodies in Wales have a statutory duty to publish Equality Objectives and to develop a Strategic Equality Plan. The Equality Act 2010 (Statutory Duties) (Wales) Regulations 2011 require that when drawing up equality objectives public authorities must have due regard to the need to have objectives that address the causes of any pay difference between employees who are from a protected group and those who are not.

The Scottish Specific Duties are set out in the Equality Act 2010 (Specific Duties) (Scotland) Regulations 2012.The duties relevant to pay include a duty to gather and use employee information, a duty to publish gender pay gap information and a duty to publish statements on equal pay. The statements must provide information about the public body’s policies on equal pay and on occupational segregation amongst its employees in respect of men and women; people who are disabled and people who are not; and people who fall into an ethnic minority group and those who do not.

The Scottish Government and its agencies collect, analyse and publish equality evidence and this is brought together in the equalities evidence area of the Government’s website. Uniquely, the site also features pages on income and poverty which relate explicitly to each of the equality strands.

Equality impact assessments are part of the framework set out by the Public Sector Equality Duty. However, it is important for public sector bodies to be aware that, irrespective of whether an equality impact assessment is required (impact assessments are not required in England), the courts place significant weight on the existence of some form of documentary evidence of compliance with the Duty, as this Briefing Paper from the House of Commons Library shows.